Air conditioners driving bill shock

For the first time, the Queensland Competition Authority has released two draft prices for the next financial year.

One which includes the carbon tax.

And one without.

The carbon tax, as it stands, is just one reason Queensland power bills are growing.

If the carbon tax is repealed, the average electricity user can expect their bill to increase by 5.4 per cent, or about $76. If it is not, then the increase to consumer's 2014/15 bill is estimated to be about a 13.6 per cent rise, or $192.

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But the carbon tax, as it stands, is just one reason costs are increasing.

Solar feed-in tariffs and network charges account for about 70 per cent of the “typical tariff 11” for residential bills. Because of those costs increasing, even if the carbon tax is removed, electricity prices will still go up.

And not using as much electricity doesn't equate to saving money in the short-term.

“It may seem strange, but actually reducing the use of the electricity grid, reducing consumption, pushes up the price of the networks,” QCA chair Malcolm Roberts said.

“The networks have a revenue cap in place, which means their costs will be recovered regardless of the consumption, so when consumption falls, the price rises for networks.

“Typical” residential households will also find $225 embedded in network charges to pay for the solar feed-in tariff by 2015-16.

The government has already reduced the solar feed-in tariff from 44 cents to 8 cents for new customers. The 8 cents price will expire on July 1, 2014. The government is still considering what it will do after that, but it hasn't ruled out further reducing the tariff.

Wholesale energy costs are also rising and will account for $68 of the 2014-15 draft recommendation.

“It is abundantly clear that Labor's carbon tax is the main driver of the increase. Scrapping the tax would save Queensland families $116 on what would otherwise be the wage rise,” he said.

“So the clear message out of today's determination and the clear message for Labor senators in Canberra is to move to scrap the tax.

“This is something that can be done, today. The legislation is in the federal parliament, it can be delivered today and it can deliver a saving to Queensland families of $116 from July 1 next year.”

Energy minister Mark McArdle was, unsurprisingly, in agreement.

“Today, December 2013, the Senate can remove the carbon tax upon the people of this state. We are doing everything that we can, it is now up to the ALP in this state, senators and the Greens senator and the ALP state members as well, to stand up and say who are they out for; the ALP interests or the interests of the people of Queensland.”

As for what the state parliament can do, Mr McArdle said his government was looking at the poles and wires side of the business with a view to “cutting that cost down significantly”.

“$1.7 billion over three years will be removed from the poles and wires,” Mr McArdle said.

“It is one of the levers we need to push down. Contrast that with what can happen today, we can remove the carbon tax now.”

Rebates for lower income earners will continue, Mr McArdle said, but he wouldn't be moved from the line that removing the carbon tax was the main answer to lowering prices.

“We keep talking here about down the track; I'm talking about December 2013. They can make a real statement today.”

Despite more countries moving towards a carbon tax arrangement, Mr McArdle said his government could only deal with the here and now.

“I'm dealing with what we are dealing with here, in this state, and in this nation and in this point of time," he said.

"This carbon tax is adding significantly to the power bills of Queenslanders.

“I have no doubt that Queenslanders do not want to pay higher prices and today is unwelcome news, but if the [federal] government can take a step to cut the power price and the increase, why doesn't the Greens and the Labor Senators simply do that? It is a sweep of the pen, $116 will be saved and that is the best thing which can happen today.”

Mr Nicholls, agreed.

“The reality is, we have a new tax – it is adding a cost to families, it is particularly adding it on to families who use a lot of electricity," he said.

"The simple answer is, removing the carbon tax will save families money. It will save them $116 on what would otherwise be a very substantial increase on their power prices.

The message to people who are going to be in Canberra voting on this particular legislation is this; if you want to save Queenslanders money, scrap the tax.”

87 comments so far

In other words, Tim Nicholls blaming the carbon tax this morning was an outright lie.

Commenter

Mike

Date and time

December 11, 2013, 2:32PM

This explains it - two thirds of cost increase came from gas price rise and networks and retailers. http://tinyurl.com/bhcs56c

Commenter

lami

Location

sydney

Date and time

December 11, 2013, 6:05PM

Spot on Mike, I've been watching Mark McArdle repeating this lie this afternoon. We have already been paying the Carbon Tax, it raised our bill by 9%, since then though the LNP has gouged us 22.6% and in July next year another 13.5%. Yet they try and point the finger elsewhere. This rise is probably to pay for the redundancies of Energex and Ergon workers, now surplus to requirements while they hand all the work to their contractor mates, who have been proven to cost more to do things than the authority workers.Remembering of course that Energex and Ergon make the LNP government huge profits every year, this is obviously to pay for their failures in economic policy. They own this price rise, no-one else.

Commenter

cycloniq

Date and time

December 11, 2013, 6:31PM

Just like everything else that comes out of his mouth. Have you ever a seen a more shady, dishonest looking front bench?

Commenter

Neal

Location

Cairns

Date and time

December 11, 2013, 10:03PM

It's just all too difficult for Mark as it is all too Mc(H)ardle

Commenter

Metatron

Date and time

December 12, 2013, 7:44AM

So the smart thing for Labor to do would be repeal the Carbon Tax immediately, so prices drop by $116. The the LNP can then explain to us why prices are going up by $192.IE the base price is always the cost excluding taxes.

Commenter

Scotty_16

Date and time

December 12, 2013, 9:14AM

Every report ever has proved that the carbon tax's effect on the economy is negligible, the 5.6% that it addsto people's bills was more than paid back to everyone by the Labor govt. The 'wrecking ball' then 'python' squeeze from Abbott has been one of the biggest cons I have ever seen. If you still believe Abbott, that's all it is, a belief, an article of faith, not truth that can be supported by evidence or reason. Faith is a very poor substitute for truth.

Commenter

Marktlog

Date and time

December 11, 2013, 2:45PM

I have been directly involved in the National Electricity Market since March 1999 when I joined Ergon Energy and for the past seven-years I have run my own electricity brokerage business in Brisbane, therefore I have witnessed the full impact of the Carbon Tax. I Account Manage the electricity supply accounts and contracts for approximately 350-business customer sites throughout QLD, and to provide an example, one of my customers, a non profit sporting club, saw their electricity accounts increase by approximately $6,000/month upon the introduction of the Carbon Tax on the 1st July 2012 and they asked me to investigate the matter. I found that their account increased by $1,500/month due to Network Charge increases from Energex Network (which is essentially line rental charges) and a $4,500/month increase due to the Carbon Tax. I also audited the domestic electricity supply Tariff (Tariff 11) in July 2012 and found that it had increased by 11.4%, despite Campbell Newman freezing Tariff 11 from the 1st July 2012....therefore the Carbon Tax increased domestic electricity accounts by 11.4%. At the time I was investigated by the ACCC in late 2012 regarding my comments on the Carbon Tax and was given the all clear as I was able to back my comments with facts and figures. Don't be fooled, the Carbon Tax is affecting you by more than you know and it needs to be scrapped...this is the Tax that Julia Gillard said would never be introduced under her Government and yet here we are people....

Commenter

Power Select

Date and time

December 11, 2013, 6:22PM

@ Power select your claims are false, the carbon tax component is listed on the bill, it has been 2.3 cents a unit since it's inception, which for me was a rise just over 9%, Since the LNP came to power they gave us a 22.6% price rise and now another 13.6% slug. Add to this the network charge that rose by 150% under their watch and it is clear they have been gouging us. I too used to work for Ergon Energy and have seen their false economies actually blow out the costs. They are milking us to pay for their failed ideological economic policies that have seen this state go backwards.

Commenter

cycloniq

Date and time

December 12, 2013, 9:01AM

That not for profit sporting club must have used an enormous amount of electricity for the carbon tax increase alone to have been $6000 per year.

As for the ACCC I fully understand why they investigated you making such bogus claims as the carbon tax increased electricity costs by 11.4% I would suggest you were very lucky not to be fined.

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